Corruption and Crime in Bihar –
the Lalu-Nitish Continuum


Five years ago, in November 2005 Nitish Kumar had won an unexpectedly huge mandate. It is widely believed that three factors militated in favour of Nitish Kumar to give him such a clear and comfortable majority. For one, Bihar was absolutely fed up with Lalu Prasad’s prolonged reign of comprehensive misrule. Secondly, the February 2005 polls had produced a hung Assembly, and six months of President’s Rule had pushed Bihar more definitively towards a new dispensation under Nitish Kumar’s stewardship. But there was also an element of hope, with the slogan “Nitish Kumar, Naya Bihar”, brand Nitish was marketed as Bihar’s passport to change and prosperity.
Five years down the line, as Nitish Kumar gets ready to face the electorate, he relies more on invoking the fear or threat of Lalu Prasad staging a comeback than on his tired rhetoric of ‘development with justice’. And by offering himself as the chief ministerial candidate of the RJD-LJP combine, Lalu Prasad is playing perfect ball. While Nitish Kumar tries hard to manipulating the Lalu factor, real life however keeps exposing the growing similarity of the two rulers. The only difference is one of form and degree – while the Lalu-Rabri reign revolved almost openly around a notorious criminal-politician nexus, Nitish Kumar has kept the criminals hidden in the economic backroom letting the bureaucrat-politician nexus rule Bihar from the front.
Among other things, corruption has proved to be a particularly great leveller for both these governments. With the High Court putting off the CBI probe into the treasury fraud, the Nitish Kumar government may have got a temporary respite, but the CAG reports have already exposed how well entrenched the network of corruption is and how it has emerged as the order of the day in Nitish Kumar’s model of ‘good governance’. The Nitish Kumar government sought to make light of the Rs. 11,000 crore treasury fraud by describing it as a case of mere lag in adjustment of accounts, delay in submission of bills without involving any misappropriation or embezzlement of funds. But just when the Patna High Court reserved its judgement on the state government’s plea, the CAG report for 2008-09 was tabled in the Assembly containing revealing details of fraudulent withdrawals from the state exchequer.
Among the revelations contained in the 2008-09 CAG report, there is this shocking case of more than 3000 quintals of food grains meant for the Kosi flood victims having been misappropriated. During August-October 2007 flood relief operations in Khagaria district, the CAG found that while the official record of the Bihar State Food and Civil Supplies Corporation Limited in Khagaria maintained that foodgrains were lifted from Mansi railway station and transported through 32 trucks, the registration numbers furnished revealed a totally different story. Out of the 32 ‘trucks’ eight did not exist at all, three registration numbers were of motorcycles, 15 of tractors, four of mini trucks and one each of a jeep and a scooter! Readers will easily be transported back to the fodder scam fables of scooter-borne bulls!
The CAG also revealed cases of fraudulent withdrawals in National Rural Health Mission scheme. The Janani Suraksha Yojana, meant to encourage child-births under institutional care, has also become an easy target for the corrupt bureaucracy. Under this scheme mothers giving birth in primary health centres get cash benefit of Rs. 1400 for every birth – and the CAG has detected fraudulent withdrawals amounting to Rs. 6.6 lakh in just 14 PHCs in five districts (Kishanganj, Bhagalpur, Nalanda, Gopalganj and East Champaran), with 298 women being shown to have received cash benefit for two to five child-births in just two months! It should be remembered that there are 534 PHCs in Bihar and the CAG only checked a small sample of 14 PHCs.
While the story of two to five child-births in two months has predictably made big news in the media, the CAG report also revealed the fact that thousands of genuine lactating mothers were denied the incentive due to them. Out of 470,307 new mothers, 97,146 did not receive any cash incentive, while another 1.8 lakh beneficiaries had to wait for a period ranging between eight and 732 days to get their benefits.
There is another aspect to this shameful story. While fraudulent withdrawals are driving up the figures of institutional deliveries in Bihar PHCs, the accredited social health activists (ASHA) who are supposed to provide a key input in promoting institutional deliveries are suffering a raw deal on every count. Under NRHM, the task of recruitment and training of ASHA activists was to have been over by 2008. But the CAG report tells us that against a sanctioned target of 87135 activists, only 67506 have been recruited till March 2009 and worse still, while every activist is supposed to get a five-module training (hygiene, vaccination, first aid, transfer of patients to health centres and facilitating institutional delivery) 63802 activists have been trained only in the first module. And regarding the ‘honorarium’ and incentive paid to ASHA activists, the less said the better.
The fraudulent withdrawals exposed in the CAG report give a total lie to the Bihar government’s plea that the CAG has only pointed to anomaly in submission of bills and adjustment of accounts. Even if one were to talk only about the ‘lag’ in adjustment of accounts, it is imperative to look at the scale of the so-called ‘lag’. The norms of public spending say that advance withdrawal should be resorted to only sparingly, but in Nitish Kumar’s Bihar advance withdrawal is the rule. Nitish Kumar also amended the rules to provide for an enhanced period of six months for submission of Detailed Contingency bills to substantiate the Abstract Contingency withdrawals. But the CAG figures show that between April 2002 and March 2009, only 5,806 DC bills were submitted against 58,477 AC withdrawals – roughly 10 DC bills against every 100 AC withdrawals! And the magnitude of unaccounted or unadjusted withdrawals is a staggering Rs. 13,230.39 crore!
It is instructive to note the period of the scam – 2002 to 2009. Of the seven years under the scanner, the first three were actually the last three years of the prolonged Lalu-Rabri reign, which had earned enough notoriety in the wake of the fodder scam. Yet even the fodder scam worth Rs. 900 odd crore appears to be peanuts compared to the staggering treasury fraud quantum of Rs. 13,000 crore plus (even if only 40% of this quantum were to constitute the actual scam, it would be more than Rs. 5,000 crore)! In terms of duration, the treasury fraud period is thus more or less evenly divided into two halves separated by a 9-month interregnum of President’s Rule.
Nitish Kumar’s gospel of transparency and good governance should have meant an end to the irregularities of the RJD rule, yet the treasury fraud figures show only an exponential increase in the irregularities. AC withdrawals in 2002-03, 2003-04 and 2004-05 were Rs. 332.22 crore, Rs. 548.41 crore and Rs. 957.72 crore respectively, whereas the figures for 2006-07, 2007-08 and 2008-09 jumped to Rs. 3,849.31 crore, Rs. 3,860.47crore and Rs. 2,384.04 crore respectively with DC bills accounting for only Rs. 131.03 crore, Rs. 49.63 crore and Rs. 77.27 crore! In other words, the accumulated gap between AC and DC bills over the last three financial years alone amounts to nearly Rs. 10,000 crore!
In the wake of the High Court order of CBI probe, the Nitish-Modi government went on an overdrive to manufacture DC bills and if these bills are subjected to real physical audit and verification, this will surely open a new can of worms. And were there ever to be a credible investigation of the inflated estimates and expenses involved in the Nitish government’s biggest growth sector of road-building, we would know the real size of corruption in the Nitish model of ‘good governance’.
Nitish Kumar never misses an opportunity to congratulate himself for Bihar’s ‘miraculous increase in economic growth’ and reduced incidence of crime. It is therefore instructive to take a closer look at the changing crime profile under Nitish Kumar. In terms of total figures of cognizable offence, the crime graph of Bihar is not going down, but going up. According to figures posted on the Bihar police website, total number of cognizable offences went up from 95942 in 2001 to 133525 in 2009. For the first six months of the current year, the figure has already reached 70361. It is the incidence of kidnapping for ransom which has gone down quite significantly from the 2001-2004 levels (1527 cases in 2001-04 to 429 in 2006-09). Cases of theft and burglary however show an upward trend (from 9489 in 2001 to 15221 in 2009 in case of theft, and 3036 to 3566 over the same period in case of burglary).
In other words, big time economic crime shows a perceptible decrease and there are strong reasons to believe that this is more a case of rehabilitation of the captains of kidnapping industry as construction mafia and embezzlers of public funds than any real and absolute decline in economic crimes. There is also a general perception of reduction in urban crimes – and in his blog Nitish Kumar cites the return of family audience in cinema halls as a perceptible proof of a general reduction in crime. This whole perception revolves primarily around the experience of urban middle class and the rich; but cases of crime in rural areas, especially against dalits and women, are rising unabated. Cases of crimes against women rose from 4442 in 2005 to 6186 in 2008, while the incidence of criminal offences against dalits rose from 1572 to 2786 over the same period. More recently, Bihar has been witnessing frequent cases of armed railway robbery as well.
Real life thus lends little credence to most of Nitish Kumar’s tall self-congratulatory claims, and reveals the Lalu-Nitish continuum with regard to both corruption and crime. Indeed, without a democratic restructuring of property and power relations in the countryside it is impossible to contemplate any real victory over corruption and crime, and the battle for a new Bihar has to move on in this direction.